Forecast Sales Volume and Sales Budget

For 20Y6, Raphael Frame Company prepared the sales budget that follows.

At the end of December 20Y6, the following unit sales data were reported for the year:

	Unit Sales
	8" 10" Frame		12" 16" Frame
East	29,458		8,944
Central	6,969		2,156
West	6,048		1,530

For the year ending December 31, 20Y7, unit sales are expected to follow the patterns established during the year ending December 31, 20Y6. The unit selling price for the 8" 10" frame is expected to increase to $29 and the unit selling price for the 12" 16" frame is expected to increase to $45, effective January 1, 20Y7.

Required:

A. Compute the increase or decrease of actual unit sales for the year ended December 31, 20Y6, over budget. Use the minus sign to indicate a decrease in amount and percent. Round percents to the nearest whole percent.

B. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 20Y7, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 20Y7. Use the minus sign to indicate a decrease in percent. Round budgeted units to the nearest whole unit.

C. Prepare a sales budget for the year ending December 31, 20Y7.

Raphael Frame Company Sales Budget For the Year Ending December 31, 20Y6 Unit Unit Sales Total Sales Product and Area Selling Volume Price 8" x 10" Frame: East $28 $800,800 28,600 Central 6,900 28 193,200 West 6,300 28 176,400 Total 41,800 $1,170,400 12" x 16" Frame: $43 $369,800 East 8,600 Central 94,600 2,200 43 43 West 1,500 64,500 12,300 Total $528,900 $1,699,300 Total revenue from sales Unit Sales, Increase (Decrease) Year Ended 20Y6 Actual Over Budget Budget Actual Sales Amount Percent 8" x 10" Frame: % East Central West % 12" x 16" Frame: East Central % West 20Y7 20Y6 Percentage Budgeted Actual Increase (Decrease) Units (rounded) Units 8" x 10" Frame: East Central % West % 12" x 16" Frame: East Central % West Raphael Frame Company Sales Budget For the Year Ending December 31, 20Y7 Product and Area Unit Sales Volume Unit Selling Price Total Sales 8x 10" Frame: East Central West Total 12" x 16" Frame: East Central West Total Total revenue from sales